Month-end Reporting Best Practices

Contents

• Overview
• Close a Financial Period
• Reporting
  • MRR Reconciliation (Ordway to External System) 
  • Accounts Receivable Reconciliation
  • Reconciling Tax between Ordway (Sales Tax Report) and Avalara
  • Cash Reconciliation
  • Deferred Revenue Waterfall 
• Best Practices
• Related Topics
• FAQs

Overview

The Month-End Reporting Best Practices guide provides recommended steps to help identify variances and validate financial data before closing a financial period. 

Use the sections that are most relevant to your organization's month-end reporting and reconciliation process.

Close a Financial Period

Month-end Close Process

Note: When journal entry generation is set to automatically under Setup > Finance, skip Step 1.

1. Add a Journal Entry Run (JER) for the period/month for ALL transaction types with Journal Entry Date = Transaction Date.
   

2. Navigate to Finance > Financial Periods, review the Summary Balances, ensure Unposted transactions do not exist. Any unposted transactions, and their corresponding financial/accounting impact to Revenue, A/R, Cash, etc. are not recognized in Ordway when left unposted.

   Note: When a user tries to close the Financial Period with unposted transactions, Ordway alerts the user and required additional action.

3. Review the Summary Entries. The detailed Journal Entries for the month are summarized by transaction type (Example: Invoices, Payments, Revenue Schedules)
4. Download Journal Entry Export to use as supporting documentation during reconciliation. It can also serve as a backup of financial records.
5. After completing your review, select More > Close and confirm the warning message. 
   Note: Closing a financial period also closes all previous periods. Opening a financial period opens all future periods.
   

Reporting

MRR Reconciliation (Ordway to External System) 

Objective

Validate the completeness and accuracy of MRR in Ordway by comparing it with your CRM. This reconciliation verifies that bookings have successfully synchronized through integrations, imports, or manual processes.

Filter 

• Discounted MRR = true or false, depending on how your CRM reports MRR.

Important! MRR is reported only when the last day of the month contains an active subscription with a recurring charge. One-time and usage-based charges are excluded unless configured otherwise.

Steps

1. Download/ Export the MRR report from Ordway.
2. Download/ Export the corresponding MRR report from your CRM (for example, Salesforce).
3. Compare records using a shared identifier, such as sf_account_id. If differences exist, verify:
   • Whether the subscription covered a partial period.
   • Whether the subscription is Active or still in Draft.
   • Whether subscriptions were cancelled during the month.

Accounts Receivable Reconciliation

Objective

Compare the ending Accounts Receivable balance with the Accounts Receivable Aging Report to verify invoice, payment, credit, and reversal activity.

Filter - Only use the date filter. 

Important! The AR Aging Report uses invoice balance history. The audit log alone may not identify all reconciliation differences.

High-Level Validation

1. Run the Account Balance (Cumulative) report. See Account Balance (Cumulative) Report for more details
2. Run the Accounts Receivable Aging report using the last day of the month as the target date. See Aging Report 
3. Compare the ending Accounts Receivable balance with the Total Outstanding balance.

Steps

1. Run the Account Balance (Cumulative) Report, and drill-down on the Accounts Receivable for the month.
   
2. Export the detailed report.
3. This output can be opened in Excel and will show all the transactions that had financial/accounting impact on A/R. It is important to filter the date range for ONLY the current month (assuming the prior month ending balance has already been reconciled, which validates the beginning balance of this month).
4. Compare the results with the Accounts Receivable Aging export.

Reconciling Tax between Ordway (Sales Tax Report) and Avalara

Credits are not being reported in Avalara, making reconciliation of the Standard Tax Report to Avalara and to the G/L Account Balance imperfect for periods/months where there was at least 1 Ordway Credit to the Tax G/L Account code.

Cash Reconciliation

Steps:

1. Export Ordway Payments (Navigate to Menu > Operations > Payments > Export Payments). 
2. Download Stripe Payments directly from your Stripe account.
3. Compare in bulk and if mismatch, use Payment Runs to determine which records are causing a variance.

Note: Be mindful of any refunds since the Stripe fee will actually be refunded. Reduce Stripe Fee G/L and Refunds by the Stripe fee related to any current month period refunds

Deferred Revenue Waterfall 

This report shows the balance of all Deferred Revenue Accounts as of the end of a selected month, and a forecast of expected changes based on the latest Billing Schedules and Revenue Schedules. Read more about the Deferred Revenue Waterfall Report.